TOC: Partial Signal Consent Given

The Thoroughbred Owners of California has given limited consent to New York’s off-track betting corporations to accept wagers on California races, but is holding firm on its stance against allowing wagers from the companies’ out-of-state account deposit wagering customers.

The TOC on Feb. 1 withdrew its consent for California Thoroughbred signals and shut out New York OTB customers from placing wagers on Santa Anita Park and Golden Gate Fields racing, claiming the betting companies were usurping agreements by not accepting higher rates on wagers from non-New York ADW customers.

But TOC president Drew Couto said the horsemen’s group on Feb. 4 gave its consent for the six New York companies to accept wagers from customers frequenting “brick and mortar” establishments, and those New York residents with ADW accounts.

Couto told The Blood-Horse Feb. 5 that the issue was never about walk-up customers and New York residents with ADW accounts, but with the companies' ADW customers that are non-New York residents he claims were conducting inter-state wagering.

“What we don’t agree on is the inter-state component,” Couto said.

Couto said New York’s OTB system has operated with California under a two-tier agreement rate for “brick and mortar” customers who frequent the dozens of physical facilities scattered about the state, and those New York residents who have accounts that allow them to wager either by telephone or the Internet. Those rates, he said, are well known for being among the lowest in the industry, and called the rate given for walk-up facilities the lowest “by far.”

“In the past, the New York OTBs operated under one rate, which everyone in the industry felt was ridiculously low," Couto said. "So we developed a second tier. What we didn’t know until recently was that we needed a third tier.”

Ira Block, who is executive vice president of legal affairs and general counsel for one of the six OTB companies, New York Off-Track Betting Corp., said he felt it was “inappropriate” to negotiate business matters in the press.

But Block did say a previous statement made by Couto in Daily Racing Form was “100% inaccurate.” In that article, Couto was paraphrased as saying the New York OTBs had paid a higher rate for out-of-state wagers during the Hollywood Park fall meet, but declined to pay higher fees for other California signals.

“The facts don’t change over time,” Block said, declining to elaborate. “But I am optimistic and hopeful that upon a further review of the situation, the TOC will change its position.”

The New York Off-Track Betting Corp. represents all of the state’s off-track companies in negotiations. Both Couto and Block declined to identify the specific percentage rates involved in the agreements.

The Santa Anita and Golden Gate signals are both controlled by TrackNet Media Group, the racing content consortium of Churchill Downs Inc. and Magna Entertainment Corp. Scott Daruty, the president of TrackNet, said he couldn’t comment on the situation “given the sensitivity of the ongoing negotiations.”

It’s unclear at this point what California signals will be made available to New York OTB customers in the near future. Golden Gate closed its meet Feb. 3, and Bay Meadows opens its meet Feb. 6. Santa Anita Park is closed for track renovations until at least Feb. 8. Couto said the New York’s OTBs will have California signals available to them, but it’s up to the companies to prohibit wagering by out-of-state ADW customers.

“Every other ADW company can tell where the residency of their account holders is,” he said.